[oowolf]

http://www.dailykos.com/story/2005/3/21/83247/6006

[Tanada]

I read through the Moly argument with a bit of amusement, no sarcasm intended. To me the fundamental differences between Moly in Steel production vs Oil in the economy are huge. Moly only makes of a small percentage of some specialty steels, hence you can increase the cost of molly 14 times over but it only cost 2-3 dollar's more per ton of steel made with that Moly. If you increase the cost of petroleum 14 times over you basically just collapsed the world economy and everything is the end. If you double the cost of petroleum as happenned in the last 5 years, mostly in the last 2, you start to put braking force on some sectors of the economy and boost other sectors. People who own stripper wells for instance benefit a lot and they go out and invest or spend a lot of their increase which stimulates some kinds of economic activity. At the same time low income end users like the lower bracket of retiries start modifying their behavior and spending less because travle and shipping for the goods they do consume cost them a higher fraction of their fixed income. Goods which are shipped long distance creep upward in cost at the wholesale and retail levels. Ultimately the demand growth slows a bit.

If the price of oil doubles again this year as a lot of people are guessing it is going too that will increase the price at the pump roughly $1.50 over todays price. That will have a visible impact on American demand IMO at which time the price will roughly stabilize unless something disrupts supply.

[WebHubbleTelescope]

Molybdenum extraction ties into copper mining. If copper goes down then moly gets scarce. Copper extraction plummeted after the world got fully networked. Therefore the price of moly shot up. Interesting though how suddenly prices can fluctuate.